EFT Bill payments for taxes
We are dealing with a situation I've never been involved with before. This year BMO switched from faxing us a listing of tax payments overnight to us logging into an online portal daily and retrieving the information. This report has two date columns; one is the "payment date" and one is the "effective date".
We have always relied on the "effective date" on the reports we get from all financial institutions as the date the payment was deemed to have been made, and have never run into troubles. Times where there was a date/time in the "payment" column that differed from the "effective" column we chalked up to people who may have post-dated an online payment, or may have made the payment after the bank's cutoff for the day.
This year, with the new BMO reporting we noticed a considerable increase in the number of payments that were made on July 3 (tax deadline) that had an effective date of July 4. All those accounts were penalized.
The local branch hasn't been able to respond with information as to what the difference in the two columns means, and so far we have stood firm that those payments were deemed effective on the 4th are are thus subject to penalty.
I am now in communication with BMO in Toronto who says that the "effective" date is simply a reporting date and that we must honor the payment date. Even though we have several cases where the payment date is weeks before the effective date (which to me reads as a post-dated payment".
Is anyone out there aware of exactly what the "effective" date is supposed to mean? How to others treat these reports?
I have attached a redacted sample of the report we get so that you can see what I'm talking about. This is just a small sample - but based on the last email I received from BMO Toronto, the Cdn payment Ass'n and BMO's terms of service require us to honor the June 25 pay date rather than the July 3 date - even though I would have assumed someone set up a post-dated July 3 payment on June 25.
Any feedback is most welcome!